The State ofCompliance'18

In the 2018 State of Compliance report, researchers collected data to define how the regulatory compliance landscape is shifting, and identify emerging trends. The report will help companies understand today’s compliance environment, and equip them with industry and revenue-specific insights they can use to make informed decisions and develop effective compliance programs. Download The State of Compliance 2018 report today for a comprehensive view of the landscape, how companies structure their teams and programs, and the true costs of compliance.

The Compliance Landscape

Through survey responses, researchers mapped the evolving compliance landscape in which companies operate. The majority of respondents’ compliance programs addressed at least two areas of compliance, with 86 percent in scope of product compliance regulations. The Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) Regulation, the Restriction of Hazardous Substances (RoHS) Directive and the EU Conflict Minerals Regulation were the top three regulations respondents indicated they are in scope of.

71% identified themselves as in scope of the REACH Regulation

70% identified themselves as in scope of the RoHS Directive

75% of respondents were in scope of three or more regulations

Your Compliance team

Compliance has become an interdepartmental responsibility, leveraging cross-functional resources to meet requirements, which decentralizes compliance tasks from dedicated compliance employees. Respondents named the many departments involved in compliance, as well as their functions. These results indicate a need for standardization in compliance activities, team structure and functional organization across all industries.

Top Five Functions of Compliance Teams

Your Compliance Programs

Many companies don’t leverage technology and automation to their full potential, resulting in a reliance on time-consuming and costly manual compliance processes.

38% of respondents are using a third-party software solution

26% of respondents use internally-developed solutions

75% of respondents indicated they continue to use manual processes to manage their programs

Your Compliance Resources

Compliance personnel are working hard to meet the requirements their companies are in scope of. The data collected in the survey indicates that most companies employ, at minimum, two full-time equivalents in compliance, who work with part-time resources in various departments such as legal and administration.

2,000 hrs/year The threshold for a full-time equivalent (FTE) resource.

The average number of hours spent per year on compliance processes

89% of companies predict an increase in time spent on compliance by 2021

Amplified Efforts

As companies manage growing regulatory challenges, they have reported spending more time on compliance every year. On average, companies report spending 15 to 20 percent more time on compliance-related efforts over the past three years, with some teams reporting increases as high as 200 percent. Eighty-seven percent of survey respondents reported their teams have increased their time spent on compliance efforts since 2015.

About the Author

Nick Padlo is a researcher and strategy consultant who completed his MBA at the Stanford Graduate School of Business in 2010. He consulted across a range of industries as a case team leader for Bain & Company before going on to launch investment vehicles and become the CEO of a successful startup. Prior to his time with Bain & Company, he served for five years as a Military Intelligence Officer in the U.S. Army, conducting combat effective research and advanced pattern analysis, earning the Bronze Star Medal. He earned his Bachelor of Science degree at the United States Military Academy at West Point, where he graduated in the top 1 percent.

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With Contributions from Partners & Advisors

Download last year's State of Compliance report to read the 2017 insights. Download